DraftKings CEO commits to staying “disciplined” amid increased US competition
Jason Robins draws on DraftKings’ experience of dealing with prior market challengers as he addresses the emergence of ESPN Bet and Fanatics
DraftKings CEO Jason Robins has downplayed the impact of increased competition in the US sports betting market, suggesting the firm will not alter its tactics and will remain “disciplined” in its approach.
Robins spoke as part of DraftKings Q3 2023 financial earnings call, in which the firm reported a 57% year-on-year (YOY) upward spike in its revenue to $790m for the period.
DraftKings was also recently crowned US market leader in terms of gross gaming revenue (GGR) by gaming analysts Eilers & Krejcik Gaming, edging out longtime rival FanDuel.
However, questions were asked by analysts about the emergence of sports merchandizer Fanatics as a sportsbook operator and, latterly, the move by PENN Entertainment to license the ESPN brand from Walt Disney Group to create ESPN Bet, which will launch across 17 US states on November 14.
Robins, for his part, was dismissive of the potential impact on DraftKings’ business model. “It’s not like we haven’t had fierce competition pretty much from the start,” the CEO said.
“We always expect there will be competitors that will come and try to give our customers an experience and we have to just give them a better experience.
“Last time we saw a huge wave of competition, we stayed disciplined, we didn’t increase our promotion rate and I don’t think we expect to do that this time,” he added.
Addressing the firm’s own assessments of the competitive landscape, Robins continued: “We certainly contemplated a variety of different scenarios in our guidance. At this point, I think we have a decent amount of experience and historical data on different types of competition that might emerge.
“The important thing for us is just to continue what we’ve done all along, which is to stay disciplined to focus on bringing down our promotion rate through optimization,” he added.
The DraftKings CEO said that if the operator continues to see its user base mature and promotions go to new customers, the trends it has seen for the last seven/eight quarters will continue.
When pushed by analysts on how much of the firm’s market share gains were from players switching from other apps versus existing sportsbook hold rates and growth, Robins responded: “It’s really hard to say how much of it is that, how much of its new players coming into the market and us disproportionately acquiring those players relative to competition and then retaining those players better relative to competition versus truly stealing players from competitors.”